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Emissaries from President Donald Trump's administration have negotiated with representatives of China's President Xi Jinping in recent weeks in an effort to reset the trade relationship between the two nations. | Nicolas Asfouri/AFP/Getty Images)

Trump says he is 'not satisfied' with China trade talks

President Donald Trump said Tuesday that he is unhappy with recent trade negotiations between his administration and the Chinese government but left open the possibility of progress on an issue he has put at the center of his agenda.

“China has made a fortune,” Trump told reporters. “I’m not satisfied but we have a long way to go.”

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At the same time, the president suggested his stance on trade with China is affected by how much the U.S. needs Beijing's help dealing with North Korea as a planned June 12 summit with North Korean leader Kim Jong Un approaches.

"When I think of trade with China, I'm also thinking about what they're doing to help us with peace with North Korea," he said. "That's a very important element."

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Emissaries from the Trump administration, led by Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer, have negotiated with the Chinese government in recent weeks in an effort to reset the trade relationship between the two nations, marked most significantly by the hefty trade deficit the U.S. runs with China annually.

The Trump administration has backed off of recent threats to impose tariffs on a range of Chinese goods as the talks continue. Those threats prompted Beijing to threaten retaliatory penalties and stoked fears of a trade war.

After a request from Chinese President Xi Jinping, Trump has also pledged to lift a seven-year ban on Chinese telecommunications giant ZTE doing business with American firms. That prohibition was imposed last month by Commerce Secretary Wilbur Ross after ZTE was caught violating the terms of a $1.19 billion penalty agreement for making sales to Iran and North Korea. The ban prompted ZTE to announce earlier this month it was ceasing major business operations

ZTE should pay a "very large" fine, install new management and be required to buy a large percentage of their parts and equipment from U.S. companies, but it should not be forced to shut down, Trump said Tuesday.

"By shutting them down, we're hurting a lot of American companies," Trump said. "Really good American companies."

The Wall Street Journal reported on Tuesday that the United States and China had agreed to the broad outlines of a deal that would lift China's retaliatory duties on U.S. agricultural products in exchange for the United States lifting the ZTE ban.

Mnuchin told a Senate panel on Tuesday that the Trump administration was not backpedaling on ZTE, even though Trump had agreed to look into changing the penalty at Xi's behest.

"I can't comment on what the Commerce Department is considering, but I assure you anything that they consider will take into account the very important national security issues and those will be addressed," Mnuchin said. But "the objective was not to put ZTE out of business; the objective was to make sure that they abide by our sanctions program."

Mnuchin and others in the administration have insisted that any relief for ZTE is entirely separate from the broader trade deal being discussed with China. Still, Ross has been charged with negotiating key long-term agricultural and energy contracts with Chinese companies to reduce the bilateral trade deficit.

Planning for that trip in early June comes as his department is considering what, if any, changes to make to the ZTE ban.